Frank Eckard, CEO of German magnet maker Magnosphere, says automakers are desperate for magnets. China’s export limits on rare-earth magnets threaten to halt car production by mid-July. “The whole car industry is in full panic,” Eckard said. “They will pay any price.”
China controls most of the rare-earth supply, essential for many car parts like motors and sensors. Several European plants have already shut down. The U.S. and China are negotiating to ease restrictions.
Automakers are racing to find alternatives, but new magnet technologies are years away. The EU is trying to boost local supplies, but progress is slow. Meanwhile, factories risk shutdowns without enough magnets.
Experts warn this could be the third major supply shock in five years, after the semiconductor shortage and COVID-19 disruptions. China’s dominance over key raw materials remains a serious threat to global auto production.
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